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Mittal: Icon or Predator?

Assume that Arcelor or even Mittal had made a bid for Tata Steel. Would the Indian government have backed them?

There was a time, not so long ago, when most foreign magazines, The Economist of London included, ignored India. As far as they were concerned, India simply did not count, except when it was hit by a famine or other similar calamities, and when foreign adventurers, like Quattrochi, made headlines.

Times have changed. India is now big news and not only when Indian tycoons like Laxmi Mittal make takeover bids for giant European companies like Arcelor. A recent issue of The Economist carried five stories on India, including an editorial on Mittal and the recent strike at our airports. And believe it or not, the paper has a full-fledged editorial office in Delhi, just as it has in Washington DC.

Why are foreigners so much interested in India now, including men like Bill Clinton who thinks that Indian weddings are the greatest thing since Roman circuses, two thousand years ago? In fact, India and China appear every now and then on front pages of The New York Times and were mentioned by George W Bush in his State of the Union Address to the US Congress. There was a time when India used to be bracketed with Pakistan, not China, which always made me laugh. But now it is India and China, like Laurel and Hardy or Punch and Judy, though I doubt whether American children really can differentiate between the two.

But let me go back to Mittal. His bid for Arcelor, which is nearly twice the size of his own empire, has made him the most hated man in Europe, on par with Adolf Hitler. He is seen, as something of a bully, which is what Hitler was, a predator who wants to grab a big slice of European business, and may be other things too in due course. President Chirac of France called the Mittal bid hostile, which, of course, it is, but which is also another way of calling Mittal an enemy.

But it is not as simple as that. When Swraj Paul, a London-based Indian businessman, came in India 20 years ago and tried to grab DCM and Escorts, most of us resented it and he had to beat a retreat. It was believed at the time that Paul had the blessings of powers-that-be in the government and he was in fact acting a proxy for some interests close to the government. But that didn't prevent some of us hauling him over the coals, until the poor fellow fled the scene.

These things work both ways. Mittal says the Indian government is backing him, and commerce minister Kamal Nath actually came to his help by writing to Peter Mandelson, trade commissioner of Europe, asking for cooperation in getting the deal through. But assume, for the sake of argument that Arcelor or even Mittal had made a bid for Tata Steel, which is a much smaller plant. Would the Indian government have backed them? Would it have asked Tatas to hand over their plant to him and not make too much fuss about it?

Globalisation is all very well, but we live in a world, which is neatly parceled into nations, large and small, and you cannot really ignore them. Tata Steel or Reliance is much more than private corporate enterprises. They are also national enterprises. They are very much a part of the national psyche. So when an outsider comes barging in and flexes his muscles, he rouses raw emotions, which is why they engage the attention of presidents and prime ministers.

Good luck to Mittal! But good luck to Arcelor too!